Housebuilder says 80% of staff now stood down as it secures £300m government-backed loan
Redrow has put more than 1,800 staff in furlough, equivalent to 80% of its workforce, the firm said today.
The housebuilder made the admission alongside announcing it has secured a £300m government-backed loan to help it through the coronavirus crisis.
The firm, which said last month that it was putting some staff in furlough but did not specify how many, today said that “currently around 80% of the workforce has been furloughed under the Government’s Job Retention Scheme”.
The firm said in last year’s annual report that it employed 2,304 people, meaning the move will see around 1,850 staff put in furlough, where they are unable to work but the government pays 80% of their wages.
Redrow has not said whether it is topping up the wages of furloughed staff to ensure they do not see a 20% drop in income.
But the move will slash the firm’s £109m wage bill, with the board, senior directors and “wider directorate” all taking a 20% pay cut for the duration of the crisis.
Redrow said it had successfully secured a £300m loan under the Bank of England Covid Corporate Financing Facility, designed to allow firms with investment-grade credit ratings to borrow cheaply to offset business impacts of the crisis.
Redrow said it had not yet drawn down the loan and was in negotiations to secure an additional £100m of financial headroom from its existing lenders, taking its commercial credit facility to £350m. It said it expected these to be wrapped up by the end of the month.
Redrow reported having £124m in net cash at the end of its last financial year in June 2019.